The UK has left the EU and new rules for business came into force on 1 January 2021. Even though a deal has been secured, doing business with Europe has changed. Here we look at changes affecting use of the CE Marking, Customs Declarations, and Import VAT.
Changes regarding use of the CE Marking
New rules are here, including changes affecting use of the CE marking and the introduction of the new UKCA marking. If you place goods on the UK and EU markets, you should act now.
The actions you need to take depend on the type of goods you’re placing on the market. For example, different rules apply to sector specific goods such as vehicles, chemicals and medicines, and non-harmonised goods such as furniture. Sector specific guidance can be found via the link here.
This post is focused on ‘New Approach’ goods, which are those goods which typically bear the CE marking (e.g. machinery, electronics, toys, PPE).
Placing New Approach goods on the GB market
Businesses should adapt to the new UK regime and the new UKCA marking, which came into force in Great Britain on 1 January 2021. There are separate rules that apply in Northern Ireland.
However, to allow businesses time to adjust, most CE marked goods that meet GB and EU requirements can continue to be placed on the GB market until 1 January 2022 (where GB and EU requirements remain the same).
The above does not apply if your certificate of conformity is held by a UK Approved Body and you do not have an additional certificate from an EU recognised Notified Body. In this instance, you will need to use UKCA immediately.
It’s important that you check your legal responsibilities for the products you sell as some of these may have changed since 1 January. You may wish to check whether you or another business in your supply chain is taking on these responsibilities. For further guidance check GOV.UK.
Since 1 January 2021, some GB based distributors of EU goods became importers and some EU based distributors of GB goods also became importers.
In most cases, importers will need to indicate their name and address on the product or packaging when a good is being placed on the GB market, among other responsibilities. If the good is from the EEA or Switzerland, these details can be provided on accompanying documentation rather than on the good itself until 31 December 2022. EU based importers will need to comply with EU requirements immediately.
Requirements around authorised representatives have also changed. The use of authorised representatives is largely optional; however, if you do choose to use an authorised representative they will need to be based in the UK (including Northern Ireland) for products being placed on the GB market.
The EU no longer recognises UK-based authorised representatives, so if you choose to or are required by EU legislation to use an authorised representative or responsible person, they will need to be based in one of the 27 EU member states or Northern Ireland. When placing goods on the market in Northern Ireland, authorised representatives can be based in Northern Ireland or any EU member state.
On the 1 January 2021, UK-based conformity assessment bodies automatically became UK approved bodies. Where third party conformity assessment is required, you will need to plan on having a certificate of conformity issued by a UK-recognised body or a body in another country which has been recognised by the UK under a mutual recognition agreement, to place goods on the market in GB. You should act well in advance of 1 January 2022.
If your business intends to place goods on the market in the EU, you will need to have a certificate from an EU-recognised Notified Body.
You should speak to your existing conformity assessment body, if you have one, to understand options for relevant markets.
Placing New Approach goods on the NI market
The Northern Ireland Protocol came into force on 1 January 2021. For as long as it is in force, Northern Ireland will align with relevant EU rules relating to placing manufactured goods on the market.
The CE marking will continue to be the relevant marking for most New Approach goods. If you self-declare for CE, you can continue to do this when placing goods on the NI market.
The CE marking will need to be accompanied by the UKNI marking if you use a UK conformity assessment body to assess against EU rules.
You should also check your legal responsibilities for the products that you sell in Northern Ireland. Businesses in Northern Ireland that buy goods from Great Britain may now take on additional legal responsibilities if there is not another business or legal entity in either Northern Ireland or the EU that is fulfilling those duties. Find out more here.
Placing New Approach goods on the EU market
If you are placing manufactured goods on the EU market you must take steps now to ensure compliance with EU requirements, such as using the CE marking and identifying changes to the responsibilities of your EU distributors.
New rules are here, and if you trade with Europe you need to make customs declarations on all goods that you export from the UK, and if you’re importing controlled goods.
If you import goods that are not controlled, you may be able to delay making your declarations for up to 175 days after import. Find out more here.
Import and export customs declarations can be complicated, and very few businesses make their own declarations. Instead they use someone else, often referred to as a customs intermediary, to deal with import and export declarations for them. Customs intermediaries include freight forwarding companies, fast parcel operators or customs brokers. Find out more about who can help you here.
If you import goods from the EU into Great Britain, you may need to pay Import VAT, and if your business is UK VAT registered you must use Postponed VAT Accounting to account for import VAT if you:
- Delay your supplementary declarations
- Import goods that are not controlled from EU countries to Great Britain between 1 January 2021 and 30 June 2021, use Simplified Customs Declaration Procedures where authorised, and make an Entry in Declarants Records
This means that you can account for and recover import VAT on the same VAT return, subject to normal rules on input tax deduction.
In other circumstances UK VAT registered traders will be able (but not compelled) to use Postponed VAT Accounting to account for import VAT on their VAT Return for goods imported from anywhere in the world. Find out more here.
Rules of Origin
You need to make sure that you know how to classify your goods, and how you’ll evidence their origin. A customs intermediary can help you ensure your goods are classified correctly. If you do not classify your goods correctly or if you do not accurately record the origin of the goods in your customs declaration, you may be charged the wrong amount of tax or duty. If you choose not to hire an intermediary, you will need to do this yourself.
HMRC are sending weekly trader updates to provide hints and tips on getting used to the new rules and to let you know where you can find more support.
And if you're preparing to move goods under the Northern Ireland Protocol, you can register for the free Trader Support Service.
If you’re still not confident that you’re fully prepared please do not try to move goods until you have taken action. If you don’t have the correct authorisations, contracts and agreements in place you could face delays and extra costs.
- Placing goods on the market in Great Britain: https://www.gov.uk/guidance/placing-manufactured-goods-on-the-market-in-great-britain
- UK Market Conformity Assessment Bodies database: https://www.gov.uk/uk-market-conformity-assessment-bodies
- Placing manufactured goods on the EU market:https://www.gov.uk/guidance/placing-manufactured-goods-on-the-eu-market
- Placing manufactured goods on the market in Northern Ireland: https://www.gov.uk/guidance/placing-manufactured-goods-on-the-market-in-northern-ireland
- Moving qualifying goods from Northern Ireland to the rest of the UK: https://www.gov.uk/guidance/moving-qualifying-goods-from-northern-ireland-to-the-rest-of-the-uk
- Using the UKCA marking from 1st January 2021: www.gov.uk/guidance/using-the-ukca-mark-from-1-january-2021
- Using the UKNI marking from 1st January 2021: https://www.gov.uk/guidance/using-the-ukni-marking-from-1-january-2021
- Conformity assessment bodies: status from 1st January 2021: www.gov.uk/guidance/conformity-assessment-bodies-change-of-status-from-1-january-2021
- Applying to be a UK conformity assessment body for product safety and metrology: https://www.gov.uk/guidance/apply-to-be-a-uk-cab-for-product-safety-and-metrology
- Trader Support Service: https://www.gov.uk/guidance/trader-support-service